Stephen Smith
, ContributorI blog about the politics and economics of urbanismOpinions expressed by Forbes Contributors are their own.

Enormous viaducts like this are one reason for the project's ballooning cost estimates

Well, the other shoe has finally dropped: the California High-Speed Rail Peer Review Group is recommending that the state legislature not authorize the issue of $2.7 billion in bonds to begin paying for the state's planned $98.5 billion high-speed rail line.

The Legislature should not authorize the issuance of $2.7 billion in bonds to start building California's $98.5-billion bullet train project, a state-appointed review panel says in a key report to be released later Tuesday.

The conclusion by the California High-Speed Rail Peer Review Group is a serious blow to the project as it is currently designed because state law specifically empowered the group to make recommendation before any serious money on the train could be spent. [...]

A recent poll indicates a sharp drop in public support for the project.

The report was expected to be issued Tuesday afternoon, but the overall conclusions were described to The Times by members of the group. [...]

In an interview in late December, Sen. Joe Simitian (D-Palo Alto), chairman of the budget subcommittee for transportation, said he also believed that a one-year delay in the project would allow time to reexamine and refine exactly what the state wants to do.

We'll have to wait until the report is officially released to see the details, but if they're smart, they'll have the same objections to the project as some of the transit blogosphere's more technically-minded commentators, who largely turned against the project once the proposed $98.5 billion price tag was released back in November.

Edit: So, has this report changed anyone's minds? What's the next step for CAHSR? The SF Chronicleexplains:

It's not clear whether Gov. Jerry Brown will include funding in his next budget proposal for the initial stretch of track, an approximately 130-mile section from Fresno to Bakersfield. The governor is expected to release his spending plan next week. He could request the Legislature to approve the funding prior to the budget deadline of June 30, but delays into future years could put the federal funding in jeopardy. [...]

Brown's spokesman, Gil Duran, said in a statement Tuesday, "The peer review report will be evaluated by the Legislature, but it does not appear to add any arguments that are new or compelling enough to suggest a change in course."

Lawmakers, who reconvene today for their annual session, will hold hearings on the high-speed rail plan over the next few months.

Robin Swanson, spokeswoman for Assembly Speaker John Pérez, D-Los Angeles, said the report was not a "game changer" in terms of whether the Legislature would approve funding for high-speed rail, but said the report would receive appropriate consideration.